Dividends and Southwest Airlines returns to relatively normal flight schedule after cancellations

We all have many choices in our transportation needs, for the vehicle there are many loyal Ford or GM or other brand buyers because in the past the people were treated right or maybe badly or something by the other brand. When you fly you might be influenced by points or your company preferences or the one that made flying the least concern. Over the years companies build up a reputation and they are expected to do that on the busy days and the days which problems arise. For years, Southwest Airlines has built up a very loyal reputation and people want to fly with the airline. Then the weather happens.

In an article by Jake Bleiberg of the Associated Press, Southwest Airlines was hit the hardest by the weather in the week before Christmas. The airline was supposed to move over a million people, but things went from bad to worse with flight cancellations and lost luggage.

Federal regulators have vowed a rigorous review of what happened at Southwest, with all eyes on an outdated crew scheduling technology that left flight crews out of place after the storm hit, essentially shutting down almost all the carrier’s operations.

Southwest President Robert Jordan apologized and said the focus is reimbursing passengers and getting them reunited with their luggage. In the next quarter he will report on losses from the cancellations and refunds.

Linking to dividend paying stocks, all companies expect operations to run smoothly and need a set of defined operations when they do not. The mark of a good company is what do they do when something is not to the standard of their customers? For Southwest was always rated as one of the best airlines, it will be even tougher because they have to go above and beyond their normal. Will customers return as normal? will Southwest have to lower prices or give extra points or something that affects their profitability? will the competition match Southwest?

There are more questions than answers, till the next time – to raising questions.


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